An insurance claim is a request for an insurance provider to assume financial responsibility for a loss covered by an insurance policy. Many different types of losses may be insured, such as damage to a vehicle or home, medical conditions, death, identity theft, loss of wages due to disability or unemployment, or any other type of insurable loss.
Often, when an insurable loss occurs, a business entity is employed to provide a service associated with the loss. For example, a doctor may be employed to provide medical treatment, an auto mechanic may be employed to repair a damaged vehicle, a building contractor may be employed to repair a damaged home, or a funeral parlor may be employed to manage funeral services. Many different types of service providers exist, and in some cases a single service provider may provide multiple services. For example, a single visit to a hospital may involve multiple medical treatments. The amount of financial responsibility covered under an insurance policy (i.e., the amount of financial responsibility assumed by the insurance provider) is generally related to the specific services provided. Thus, an insurance claim typically lists the service(s) provided and the amount(s) billed by the service provider.
In some cases, the insurance provider only assumes partial financial responsibility for a given service, and the insured party is responsible for the remaining amount. For example, medical insurance policies typically require the insured party to pay a co-pay and/or deductible corresponding to a fixed amount or percentage of the medical bill. Further, one or more services included in the insurance claim may not be covered by the insurance policy, in which case the insurance provider may reject the uncovered portion of the insurance claim and defer full financial responsibility for the uncovered portion to the insured party.
In some cases, an insured party may be enrolled in multiple insurance policies of the same type, from the same and/or different insurance providers. For example, the insured party may be enrolled in two different health insurance policies. Enrollment in multiple insurance policies may occur, for example, if the insured party is married and receives insurance coverage from her employer and through her spouse. Another example is if a child has insurance coverage from both parents or from a parent's policy and a policy purchased through the child's school.
When an insured party is enrolled in multiple insurance policies of the same type (from the same and/or different insurance providers), one of the insurance policies is typically referred to as the “primary” insurance policy. The other insurance policies are then referred to as “secondary,” “tertiary,” etc. Generally, the primary insurance policy is the first recourse when filing an insurance claim. However, if the primary insurance policy does not cover the entire amount of the insurance claim, some or all of the remaining financial responsibility may be covered by the secondary insurance policy.
In some cases, the insured party (or a service provider on the insured party's behalf) may be required to file multiple insurance claim documents, for each insurance policy associated with the insurance claim. Nonetheless, the combination of filings for each insurance policy may be viewed as a single insurance claim. The use of multiple insurance policies for a single insurance claim is generally referred to as “coordination of benefits,” and allows the insured party to ultimately reduce their financial responsibility for the insurance claim.
In cases where coordination of benefits is used, the burden generally falls on the insured party to determine the remaining financial responsibility for the insurance claim. Typically, this is accomplished by the insured party maintaining a physical set of insurance-related documentation, such as mailed insurance statements, service providers' bills, or any other type of insurance-related documentation. When an insurance provider (e.g., the insurance provider for a primary and/or secondary insurance policy) mails updated information about the insurance claim to the insured party, the insured party must physically compare the most recent mailing with earlier documentation to determine whether financial responsibility has changed.